Today’s Conveyancer reported last week that the Solicitors Regulation Authority (SRA) has identified the way vulnerable customers are treated by law firms to be a key risk within their Risk Outlook report 2015/2016.
This mirrors advice by the Financial Conduct Authority (FCA) who published an Occasional Paper on Vulnerable Customers in Financial Services in February this year. The paper was designed to provide lenders with guidance in respect of good practices in identifying and dealing with vulnerable customers.
In summary, the FCA found that: “Many consumers in vulnerable circumstances are not receiving fair treatment from their financial services providers. Whilst there are examples of good practice in some firms, some people find communicating with providers or accessing products difficult.”
Paul Saunders, Head of Residential at Shakespeare Martineau describes how they have been working with their lender and broker clients to ensure that vulnerable customers, including those with mental health issues, are identified and dealt with.
“We have a specialist team who can provide onsite training for lenders. This consists of assistance in drafting internal policies in line with the lender’s corporate values and overall approach to dealing with customers allied with training on the policies.”
Paul goes on to talk about a recent case they had for a remortgage client: “All of our remortgage staff have received training in this area.
“We had an instance recently where a lady was remortgaging her property. When speaking to our case handler, she seemed unsure about not only the details of the remortgage and of her existing mortgage, but also about the product she had selected and about the next steps she would take on redemption of her existing mortgage. Correctly noting this as a cause for concern about the general potential vulnerability of the customer, our case handler referred the case to his manager.
“A call was made to the lender and broker expressing concern and the broker promised to contact his client. A follow up call from us to the broker revealed that he had been able to fully explore the bank’s customer’s financial situation with his client and to satisfy himself that the customer had mental capacity to make decisions surrounding the remortgage and in addition around her general financial position and planning. We were therefore able to satisfy ourselves and our lender client that we had dealt appropriately with a vulnerable customer. By way of added benefit, the broker was pleased that we had taken the extra time to contact him with our concerns, which he had himself harboured, prompting him to take action.”
This risk is unlikely to go away – according to the Alzheimer’s Society 1 in 14 people over 65 have dementia. Today’s Conveyancer will continue to report on SRA Risk Outlooks which are published twice a year.